Question 1

Table 28-6 
-Refer to Table 28-6. What is the U-5 measure of labor underutilization?

Accepted Answer

A)  7.5%
B)  7.9%
C)  8.1%
D)  26%E) A) and C)
F) B) and C)

Question 2

Briefly summarize the advantages and disadvantages of unemployment insurance.

Accepted Answer

The main advantage is that unemployment ...

Question 3

Not all unemployment ends with the job seeker finding a job.

Accepted Answer

A) True 
 B)False

Question 4

Most people rely primarily on income other than their labor earnings to maintain their standard of living.

Accepted Answer

A) True 
 B)False

Question 5

Within the U.S. population, teenagers (ages 16-19) have similar rates of labor-force participation than adults of prime working age (ages 25-54), regardless of race or gender.

Accepted Answer

A) True 
 B)False

Question 6

Give a few examples of how sectoral shifts temporarily cause unemployment.

Accepted Answer

Examples should focus on sectors of the ...

Question 7

Suppose that roofers are not unionized. If roofers unionize, then the supply of labor in other sectors of the economy will

Accepted Answer

A)  decrease, raising wages in industries that are not unionized.
B)  decrease, reducing wages in industries that are not unionized.
C)  increase, raising wages in industries that are not unionized.
D)  increase, reducing wages in industries that are not unionized.E) All of the above
F) A) and B)

Question 8

Some degree of unemployment is inevitable in a complex economy.

Accepted Answer

A) True 
 B)False

Question 9

Efficiency wages create a

Accepted Answer

A)  shortage of labor and so reduce unemployment.
B)  shortage of labor and so raise unemployment.
C)  surplus of labor and so reduce unemployment.
D)  surplus of labor and so raise unemployment.E) B) and C)
F) A) and B)

Question 10

A firm may pay efficiency wages in an attempt to

Accepted Answer

A)  entice workers to work the night shift rather than the day shift.
B)  improve productivity by reducing turnover.
C)  reduce costs by attracting the least-skilled workers to apply for job vacancies.
D)  All of the above are correct.E) None of the above
F) A) and C)

Question 11

In an ideal labor market, wages would adjust to balance the quantity of labor supplied and the quantity of labor demanded, ensuring that all workers are always fully employed.

Accepted Answer

A) True 
 B)False

Question 12

Suppose that the adult population in the country of Atlantis is 115 million. If 80 million people are employed and 5 million are unemployed, then

Accepted Answer

A)  30 million are not in the labor force.
B)  35 million are in the labor force.
C)  75 million are in the labor force.
D)  35 million are not in the labor force.E) B) and D)
F) A) and C)

Question 13

If the number of people unemployed rose but the number of people employed and the adult population stayed the same, then the labor force participation rate would rise.

Accepted Answer

A) True 
 B)False

Question 14

Long-run unemployment arises from a single problem that has a single solution.

Accepted Answer

A) True 
 B)False

Question 15

Which famous company executive introduced an innovative pay system that is consistent with the theory of efficiency wages?

Accepted Answer

A)  Lee Iococca
B)  Steve Jobs
C)  Mark Zuckerberg
D)  Henry FordE) A) and B)
F) B) and D)

Question 16

If a union raises the wage in its industry above equilibrium then employment in that industry

Accepted Answer

A)  and non-unionized industries falls.
B)  falls and employment in non-unionized industries rises.
C)  rises and falls in non-unionized industries.
D)  and non-unionized industries rises.E) None of the above
F) All of the above

Question 17

Over the past several decades, the difference between the labor-force participation rates of men and women in the U.S. has

Accepted Answer

A)  gradually increased.
B)  remained constant.
C)  gradually decreased.
D)  been eliminated.E) A) and B)
F) None of the above

Question 18

Suppose that some country had an adult population of about 46 million, a labor-force participation rate of 75 percent, and an unemployment rate of 8 percent. How many people were unemployed?

Accepted Answer

A)  2.54 million
B)  2.76 million
C)  3.68 million
D)  8 millionE) A) and B)
F) None of the above

Question 19

Job search

Accepted Answer

A)  is one reason economies always experience some unemployment.
B)  is the process of matching workers with appropriate jobs.
C)  would not be a problem if all workers and all jobs were the same.
D)  All of the above are correct.E) A) and C)
F) All of the above

Question 20

When a union bargains successfully with employers, in that industry,

Accepted Answer

A)  both wages and unemployment increase.
B)  wages increase and unemployment decreases.
C)  wages decrease and unemployment increases.
D)  both wages and unemployment decrease.E) None of the above
F) B) and C)

Exam 28: Unemployment and Its Natural Rate

Suppose that roofers are not unionized. If roofers unionize, then the supply of labor in other sectors of the economy will

Correct AnswerverifiedShow Answer

In an ideal labor market, wages would adjust to balance the quantity of labor supplied and the quantity of labor demanded, ensuring that all workers are always fully employed.

Correct AnswerverifiedShow Answer

Give a few examples of how sectoral shifts temporarily cause unemployment.

Correct AnswerverifiedExamples should focus on sectors of the ...View AnswerShow Answer

Efficiency wages create a

Correct AnswerverifiedShow Answer

A firm may pay efficiency wages in an attempt to

Correct AnswerverifiedShow Answer

Suppose that some country had an adult population of about 46 million, a labor-force participation rate of 75 percent, and an unemployment rate of 8 percent. How many people were unemployed?

Correct AnswerverifiedShow Answer

Within the U.S. population, teenagers (ages 16-19) have similar rates of labor-force participation than adults of prime working age (ages 25-54), regardless of race or gender.

Correct AnswerverifiedShow Answer

Job search

Correct AnswerverifiedShow Answer

When a union bargains successfully with employers, in that industry,

Correct AnswerverifiedShow Answer

Briefly summarize the advantages and disadvantages of unemployment insurance.

Correct AnswerverifiedThe main advantage is that unemployment ...View AnswerShow Answer

Which famous company executive introduced an innovative pay system that is consistent with the theory of efficiency wages?

Correct AnswerverifiedShow Answer

Most people rely primarily on income other than their labor earnings to maintain their standard of living.

Correct AnswerverifiedShow Answer

If a union raises the wage in its industry above equilibrium then employment in that industry

Correct AnswerverifiedShow Answer

Over the past several decades, the difference between the labor-force participation rates of men and women in the U.S. has

Correct AnswerverifiedShow Answer

Some degree of unemployment is inevitable in a complex economy.

Correct AnswerverifiedShow Answer

Not all unemployment ends with the job seeker finding a job.

Correct AnswerverifiedShow Answer

Long-run unemployment arises from a single problem that has a single solution.

Correct AnswerverifiedShow Answer

Suppose that the adult population in the country of Atlantis is 115 million. If 80 million people are employed and 5 million are unemployed, then

Correct AnswerverifiedShow Answer

Table 28-6 -Refer to Table 28-6. What is the U-5 measure of labor underutilization?

Correct AnswerverifiedShow Answer

If the number of people unemployed rose but the number of people employed and the adult population stayed the same, then the labor force participation rate would rise.

Correct AnswerverifiedShow Answer

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Examples should focus on sectors of the ...
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The main advantage is that unemployment ...
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